RECOMMENDATION 3. The Department of Veterans Affairs and the Department of Defense should develop criteria for selecting future federal health care center (FHCC) sites. The criteria should address the costs and benefits of establishing a fully integrated organization compared with the costs and benefits of other collaborative arrangements, such as joint ventures, taking into account local health care market trends, institutional capabilities and readiness, unique local circumstances, and departmental limiting factors. Only when firm criteria based on cost savings and the expectation of enhanced health care service delivery are met should the concept of a future FHCC be considered.

Analyze and Promulgate Lessons Learned from the Lovell Federal Health Care Center Experience


The leadership of the Lovell FHCC encountered numerous issues that had to be resolved to achieve an integrated organization and uniform policies and procedures. Many of the issues resulted from conflicting policies and procedures of the VA, the DoD, and the Navy. Some were the result of statutory requirements and the lack of statutory authority.

Many of the issues have been resolved by adopting the policy or procedure of one department with the agreement of the other department. In some cases, agreement on a single policy or procedure could not be reached and workarounds had to be developed to meet the requirements of the two departments. Some issues could not be resolved because of irreconcilable policy differences, such as an integrated police force including active duty masters-at-arms on the west campus. Ultimately, four critically necessary actions had to be authorized by legislation: (1) the authority to transfer civilian employees from one department to the other; (2) the authority to transfer the ambulatory care center and other Navy-built facilities and related personal property and equipment from the DoD to the VA; (3) the authority for the DoD to transfer funds to a joint Treasury account under the VA; and (4) the authority for DoD beneficiaries to be treated by the Lovell FHCC as they would be at an MTF. However, the legislation authorized these only as part of a 5-year demonstration in North Chicago.

Every difference between VA and DoD policies and procedures had to be addressed at multiple regional- and headquarters-level decision points. This often took months, and sometimes years, to resolve through numerous drafts and meetings. The extra burden of this process was very heavy, especially at the local level where planning the integration was an extra duty for most staff members.

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